Enterprising Developments

Why Analysts are Still Bullish on SOA

Joe McKendrick
Insurance Experts' Forum, July 12, 2010

There's been no shortage of debate on whether service-oriented architecture (SOA) was some sort of passing fad, or a real approach to modernizing and increasing the agility of enterprise systems. The debate intensified as the economy soured in 2008-2009, with many analysts and pundits predicting the death of SOA as companies put restraints on IT budgets.

New research out of Forrester reveals that just the opposite occurred—SOA continued to grow in spite of tough times, or even because of tough times. In fact, Forrester's survey of 2,100 companies finds that once SOA is in place, companies have kept expanding on their efforts. Barely a handful of companies (1% to 3%) said they have scaled back their SOA-based infrastructures in any meaningful way.

I want to add here that it's important to remember that SOA is not a generation of products, a la ERP or client/server, that came along and now vendors are moving on to something else, so it's all over except the screaming. SOA really has little to do with actual technology—it's a philosophy, a methodology, which emphasizes constructing or deconstructing flows of services to map to business processes. SOA detaches business services from underlying technology. For that reason, once service orientation begins to get baked in to organizations, there's no going back, and it doesn't matter what technologies come along next. A company may throw its ERP system out into the trash bin, but the SOA will still remain, interfacing to whatever is put in next, be it a cloud or distributed Windows-based system.

Randy Heffner, lead author of the Forrester report, observes that SOA typically lays the foundation for much broader transformations for the business: “No prior industry initiative for IT architecture has an impact as positive and broad-reaching as SOA. But SOA’s impact is only part of the story,” he says. “You have many more technology initiatives besides SOA. You need a bigger architectural vision that encompasses SOA, business process management, event processing, Web 2.0, and much more besides. Although SOA is far from dead, it should be buried inside a larger vision.”

Forrester found that 84% of Global 2000 enterprises report they are using SOA now, or will be
by the end of this year. And satisfaction runs high among this group —“more than 70% of SOA users say it has delivered enough benefit to expand its use.”

Comparing survey results from Q4 2008 and Q4 2009, Forrester says that those currently using SOA plus those planning to use SOA within 12 months advanced from 62% to 68% — an increase of 10%.

Even small to medium-size businesses are getting in the act—their adoption rose by 29%, growing from 34% to 44%.

However, as with any major initiative, it's not all sweetness and light. The Forrester report notes that that there are 20 % to 28 % that are struggling to achieve benefits.

“Achieving the most benefit from SOA requires shifts in both solution design models and governance practices, and these are not easy changes to make in an organization,” says Heffner. “The primary design shift is to treat SOA first and foremost as a business design approach, not as a technology for application integration. The right SOA governance goes a long way toward putting an end to struggles for SOA benefit.”

Joe McKendrick is an author, consultant, blogger and frequent INN contributor specializing in information technology.

Readers are encouraged to respond to Joe using the “Add Your Comments” box below. He can also be reached at joe@mckendrickresearch.com.

This blog was exclusively written for Insurance Networking News. It may not be reposted or reused without permission from Insurance Networking News.

The opinions of bloggers on www.insurancenetworking.com do not necessarily reflect those of Insurance Networking News.

Comments (2)

Agree Joe, it's all about approach and not about a generation od products. The adoption is very encouraging and growing by the day.

Posted by: Alok Ranjan | July 18, 2010 6:50 AM

Report this Comment

Your post makes very valid points: ones that often seem to be overlooked by folks arguing best-of-breed vs. suite solutions. In my opinion, once an SOA approach is adopted, the best-of-breed vs. suite discussion becomes moot. Once suites become SOA-based, the real question becomes: "What is the quality of each of the components?". Solutions that are not SOA-based can quickly become irrelevant to the discussion, since they perpetuate the "rip and replace" paradigm that an SOA approach so thoroughly replaces.

Posted by: don.goodenow | July 16, 2010 11:18 AM

Report this Comment

Add Your Comments...

Already Registered?

If you have already registered to Insurance Networking News, please use the form below to login. When completed you will immeditely be directed to post a comment.

Forgot your password?

Not Registered?

You must be registered to post a comment. Click here to register.

Blog Archive

Emerging Technology: From Insurance Challenge to Opportunity

We are now entrenched in a digital revolution that is powered by these maturing and emerging technologies.

How Allstate Puts Tech Investment in Motion

CEO Tom Wilson and other execs provide a window into how big insurers take digitalization front-and-center.

How Insurers Can Develop Thoroughly Modern Mainframes

The user experience can make or break an application. Here are five ways to measure whether itís positive or negative.

The Peer-to-Peer Economy and the Uberization of Insurance

Insurance is about risk sharing, so what better model to bring in technology and make that risk sharing as efficient and effective as possible?

Rethinking Commercial Lines Underwriting Automation

The value an insurer can achieve from the powerful combination of a modern policy system and a complete suite of advanced underwriting solutions will far outweigh any effort involved.

Students are Pushed to Look Past Obstacles, and so Should We

Student teams, in the space of a few weeks, developed a variety of fresh ideas leveraging unique technologies that could help build products and services for insurance customers.